An employee of OnLive has revealed that the cloud gaming company has officially been purchased by “an unknown party.”

Engadget, which cites the unknown ex-employee as a source, states that around 50 per cent of OnLive’s staff have been laid off, which has come just as the company was reported to be making “across the board cuts”, also adding that no severance will be offered and “stock holdings are essentially worth nothing”.

According to the site, “Those being kept on have reportedly received offer letters from the new company,”.

The ex-employee claims that the absolutely huge operating costs for running the OnLive service – about $5 million a month – are partly to blame for this sudden and rather shocking move by the company.

Despite the rather grim reports, OnLive’s director of corporate communications Brian Jaquet remains tight lipped with several “no comment” responses, and has even told Forbes that “we are not going out of business.”

TechCrunch has also recently corroborated these reports, saying that a “reliable” source has said that CEO Steve Perlman has found a buyer, and that buyer wants “wants all of OnLive’s assets – the intellectual property, branding, and likely patents.”

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